Great Falls employers not sure what ACA changes to expect

Bamma Taylor, controller for Taylor's Auto Max, is unsure how much time new reporting to the federal government on health insurance, which the business has always offered employees, will take. The reporting is a requirement of the Affordable Care Act, which begins Jan. 1.
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What's now called Taylor's Family Auto Group, the company that started as a car dealership in Fort Benton and today employs just under 100 there and in Great Falls, has not seen many changes since the Affordable Care Act went into effect Jan. 1.

But "we have provided health insurance for many years," said Bamma Taylor, controller. "Since Day One" in 1980.

Today, the company that's an umbrella for Jim Taylor Motors in Fort Benton, and Taylor's AutoMax, Taylor's ACR, Taylor's ServiceMax and Taylor's Transportation in Great Falls has "not changed what we provide. The only thing that's happened is that the cost had gone up some before (ACA) went into effect. And then ACA exacerbated rising costs."

Starting Jan. 1, 2015, though, employers the size of Taylor's apparently will be required to track and file a detailed report on what coverage they provide (see sidebar).

Taylor said one of the big frustrations began a year ago, in the run up to ACA taking effect. "We never received one word of information from the government about what was going to happen, what the expectations were on what to do, when to do it and how to do it," she said of her family's business. Information only came from Taylor's third-part providers.

Asked if she was prepared for the new reporting requirement, she said "we've always been above the standard. … Why should I have to give them information if I'm in compliance. It's onerous. … I feel like I work for the government."

Gary Sears, general manager of the Best Western Plus Heritage Inn, said "we're in a wait-and-see-type attitude, not knowing what's coming down the pike. It certainly would impact us," he said of the 181-employee hotel, Great Falls' biggest.

The Heritage does not directly provide health coverage to all employees, but he said many workers are able to purchase through the hotel's insurance agent with a cost reduction. However they often end up with high-deductible, catastrophic coverage.

Taylor's Family Auto Group has raised deductibles on its policies because family policies were getting so expensive employees couldn't afford to buy them, Bamma Taylor said. The company now deposits $60 per month into employees' health-reimbursement accounts "to help with their deductibles."

That money can be used to pay for claims before the deductible is met. "It's one thing I've done to re mediate the cost to the employee. Obviously the policy is a little cheaper" with the higher deductible, although Taylor is expecting a 7 percent to 8 percent increase in premiums when renewal comes up in December.

The healthcare.gov website has an entire section devoted to small businesses.(Photo: healthcare.gov website)

Dwight Holman, president of Holman Aviation Co. will face a different change, although, because of its size, the 24-employee flight-services company is exempt from mandates requiring insurance or reporting.

With general changes in the health-insurance market brought about by ACA, he said, his policy offerings shifted to age-based pricing. He expects increases to be "enormous. … Some employees have gone up 30 percent to 40 percent."

He said because Holman Aviation's last renewal came before ACA went into effect, "we only had to comply when we renewed."

Coverage will be redesigned and it will be more expensive for his older workers, Holman said. "They will take a really big hit."

Kim Gillan, Department of Health & Human Services Region 8 director, said "small businesses are the backbone of Montana's economy. Before the Affordable Care Act, small businesses paid 18 percent more in premiums for the same benefits as their larger competitors due to lack of purchasing power. In Montana, small businesses enrolled through the new SHOP marketplace are finding quality affordable coverage. In 2015 Montana small group rates will raise an average of 1.12 percent, well below past yearly trends."

In addition "many small employers qualify for a tax credit," Gillan said from the federal agency's regional office in Denver. "That can cut their premiums as much as 50 percent."

Gillan, a former Billings legislator and director of a workforce training program at Montana State University, said "the ACA is working to provide a healthy workforce that will support a healthy economy."

Taylor said "I don't know what's going to happen. The cost of health care has gone up, availability has gone down and employees are confused." She said in some cases, employees can find cheaper policies for their dependents on the Health Insurance Marketplace.

"It has not been fun," Taylor said. For the last two or three years, and everything that's been "pushed through, we never changed (coverage), even during the downturn of 2008. We're going to take care of our employees."

She said the health care situation is complicated for employees too and, recently, there's "frustration trying to get in to see doctors. They're overwhelmed. … Unless you have a previous relationship," with a doctor, and many employees haven't, "now they're looking for relationship with physicians and it's difficult."

Overall, Taylor said, "I'm not a huge fan. We provided insurance for 34 years. Nobody made us do this. It's a decision we made long ago, we cared for our employees and they're a vital part of our business."

2015 ACA specifics

Employer Shared Responsibility provisions

Beginning in 2015, employers with 100 or more full-time or full-time equivalent employees who do not offer affordable health insurance that provides minimum value to their full-time employees (and dependents) may be required to pay an assessment if at least one of their full-time employees is certified to receive a Premium Tax Credit in the individual Health Insurance Marketplace. Under these rules, a full-time employee is one who is employed an average of at least 30 hours per week.

The assessment, called an Employer Shared Responsibility payment, is calculated different ways and is either $2,000 or $3,000 per employee per year depending on the circumstance. Businesses are not required to make a payment on the first 30 full-time equivalent employees.

There are tax advantages to offering health coverage to employees, but Shared Responsibility payments are not tax deductible.

For employers with 50-99 full time/full-time equivalent employees, these rules will not apply until 2016 provided employers of this size meet certain certification requirements.

Information reporting on health coverage by employers

Beginning in 2015, the Affordable Care Act provides for information reporting by employers with 50 or more full-time or full-time equivalent employees regarding the health coverage they offer to their full-time employees. New information reporting by issuers, self-insuring employers, and other parties that provide health coverage also take effect in 2015. The first of these reports must be filed in 2016.

— Small Business Administration

Insurance, tax credits for small employers

The Small Business Health Options Program (SHOP) Marketplace is open to employers with 50 or fewer full-time-equivalent employees. Employers with fewer than 25 employees may qualify for tax credits if they buy insurance through SHOP. Businesses may qualify for employer health care tax credits if they have fewer than 25 full-time-equivalent employees making an average of about $50,000 a year or less.

To qualify for the Small Business Health Care Tax Credit, businesses must pay at least 50 percent of their full-time employees' premium costs. Businesses don't need to offer coverage to part-time employees or to dependents.

The tax credit is worth up to 50 percent of an employer's contribution toward employees' premium costs (up to 35 percent for tax-exempt employers).

The tax credit is highest for companies with fewer than 10 employees who are paid an average of $25,000 or less. The smaller the business, the bigger the credit.